EXHIBIT 99.1
CapitalSource Inc.
Consolidated Statements of Operations and Comprehensive Income
(Unaudited)
|
| For the Three Months Ended March 31, |
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|
| 2014 |
| 2013 |
| ||
|
| ($ in thousands, except per share data) |
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Net interest income: |
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|
|
|
| ||
Interest income: |
|
|
|
|
| ||
Loans and leases |
| $ | 101,836 |
| $ | 102,889 |
|
Investment securities |
| 5,595 |
| 9,893 |
| ||
Other |
| 576 |
| 313 |
| ||
Total interest income |
| 108,007 |
| 113,095 |
| ||
Interest expense: |
|
|
|
|
| ||
Deposits |
| 13,683 |
| 12,106 |
| ||
Borrowings |
| 4,954 |
| 6,057 |
| ||
Total interest expense |
| 18,637 |
| 18,163 |
| ||
Net interest income |
| 89,370 |
| 94,932 |
| ||
Provision for loan and lease losses |
| (1,657 | ) | 12,505 |
| ||
Net interest income after provision for loan and lease losses |
| 91,027 |
| 82,427 |
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|
|
|
|
|
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Non-interest income: |
|
|
|
|
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Loan fees |
| 2,364 |
| 3,112 |
| ||
Leased equipment income |
| 6,181 |
| 4,825 |
| ||
Gain (loss) on investments, net |
| (7,063 | ) | 1,878 |
| ||
Gain on derivatives |
| 1,499 |
| 814 |
| ||
Other non-interest income, net |
| 1,732 |
| 2,589 |
| ||
Total non-interest income |
| 4,713 |
| 13,218 |
| ||
|
|
|
|
|
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Non-interest expenses: |
|
|
|
|
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Compensation and benefits |
| 23,489 |
| 24,982 |
| ||
Professional fees |
| 1,473 |
| 1,468 |
| ||
Occupancy expenses |
| 5,538 |
| 4,215 |
| ||
FDIC fees and assessments |
| 983 |
| 1,554 |
| ||
General depreciation and amortization |
| 1,550 |
| 1,526 |
| ||
Loan servicing expense |
| 599 |
| 1,469 |
| ||
Other administrative expenses |
| 6,897 |
| 6,810 |
| ||
Total operating expenses |
| 40,529 |
| 42,024 |
| ||
Leased equipment depreciation |
| 4,244 |
| 3,400 |
| ||
Net expense of real estate owned and other foreclosed assets |
| 3,894 |
| (62 | ) | ||
Other non-interest expense, net |
| 466 |
| (707 | ) | ||
Total non-interest expenses |
| 49,133 |
| 44,655 |
| ||
|
|
|
|
|
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Net income before income taxes |
| 46,607 |
| 50,990 |
| ||
Income tax expense (benefit) |
| 23,104 |
| 21,642 |
| ||
Net income |
| 23,503 |
| 29,348 |
| ||
|
|
|
|
|
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Other comprehensive (loss) income, net of tax |
|
|
|
|
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Unrealized (loss) gain on available-for-sale securities, net of tax |
| 2,039 |
| (1,629 | ) | ||
Other comprehensive (loss) income |
| 2,039 |
| (1,629 | ) | ||
Comprehensive income |
| $ | 25,542 |
| $ | 27,719 |
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|
|
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|
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Net income per share: |
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|
|
|
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Basic |
| $ | 0.12 |
| $ | 0.15 |
|
Diluted |
| $ | 0.12 |
| $ | 0.14 |
|
Average shares outstanding: |
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|
|
|
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Basic |
| 194,415,939 |
| 201,408,526 |
| ||
Diluted |
| 199,433,816 |
| 206,240,213 |
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|
|
|
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Dividends declared per share |
| $ | 0.01 |
| $ | 0.01 |
|
CapitalSource Inc.
Consolidated Statements of Cash Flows
(Unaudited)
|
| For the Three Months Ended March 31, |
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|
| 2014 |
| 2013 |
| ||
|
| ($ in thousands, except per share data) |
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Operating activities: |
|
|
|
|
| ||
Net income |
| $ | 23,503 |
| $ | 29,348 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
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|
|
|
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Stock option expense |
| 436 |
| 540 |
| ||
Restricted stock expense |
| 2,770 |
| 2,530 |
| ||
Amortization of deferred loan fees and discounts |
| (5,438 | ) | (8,614 | ) | ||
Paid-in-kind interest on loans |
| (61 | ) | 5,273 |
| ||
(Negative provision) provision for loan and lease losses |
| (1,657 | ) | 12,505 |
| ||
Amortization of deferred financing fees and discounts |
| 93 |
| 533 |
| ||
Depreciation and amortization |
| 6,132 |
| 4,334 |
| ||
Loss (gain) on foreclosed assets and other property and equipment disposals |
| 3,387 |
| (467 | ) | ||
Provision for deferred income taxes |
| 16,017 |
| 17,699 |
| ||
Loss (gain) on investments, net |
| 7,176 |
| (922 | ) | ||
Unrealized loss (gain) on derivatives and foreign currencies, net |
| 383 |
| (634 | ) | ||
Decrease in interest receivable |
| 1,035 |
| 2,225 |
| ||
Decrease (increase) in loans held-for-sale, net |
| — |
| (2,591 | ) | ||
Decrease in other assets |
| 6,810 |
| 9,630 |
| ||
Decrease in other liabilities |
| (22,925 | ) | (12,981 | ) | ||
Cash provided by operating activities |
| 37,661 |
| 58,408 |
| ||
Investing activities: |
|
|
|
|
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Decrease (increase) in restricted cash |
| 46,289 |
| (424 | ) | ||
Increase in loans, net |
| (246,776 | ) | (41,349 | ) | ||
Sale of investment securities, available for sale |
| 45,187 |
| 103,568 |
| ||
Sale or call of investment securities, held to maturity |
| 25 |
| 28,653 |
| ||
Purchase of investment securities, held to maturity |
| — |
| (22,868 | ) | ||
Reduction of other investments, net |
| 4,222 |
| 734 |
| ||
Acquisition of property and equipment, net |
| (24,031 | ) | (8,217 | ) | ||
Cash (used in) provided by investing activities |
| (175,084 | ) | 60,097 |
| ||
Financing activities: |
|
|
|
|
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Deposits accepted, net of repayments |
| 102,256 |
| 153,680 |
| ||
Proceeds of other borrowings |
| 90,000 |
| 5,000 |
| ||
Repayments and extinguishment of term debt |
| — |
| (103,035 | ) | ||
Repurchase of common stock |
| — |
| (137,988 | ) | ||
Proceeds from exercise of options |
| 6,253 |
| 1,565 |
| ||
Payment of dividends |
| (1,943 | ) | (1,980 | ) | ||
Cash provided by (used in) financing activities |
| 196,566 |
| (82,758 | ) | ||
Increase in cash and cash equivalents |
| 59,143 |
| 35,747 |
| ||
Cash and cash equivalents as of beginning of period |
| 455,799 |
| 299,086 |
| ||
Cash and cash equivalents as of end of period |
| $ | 514,942 |
| $ | 334,833 |
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Noncash transactions from investing activities: |
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Assets acquired through foreclosure |
| $ | 34 |
| $ | 728 |
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